Mandatory Medicare Secondary Payer (MSP) Reporting

Grandfathering Fact Sheet
Under the recently enacted federal health care reform legislation, health plans can be grandfathered.
Interim Final Regulations have been published to provide further clarification on grandfathering.
These rules are designed, according to the Obama administration, to allow grandfathered plans to
“innovate and contain costs by allowing insurers and employers to make routine changes without
losing grandfather status.” In general, grandfather status will be lost if there are significant reductions
to benefits or increases in out-of-pocket spending for consumers, such as deductibles or co-pays.
We believe there are benefits to grandfathering for our groups and individual members who wish to
maintain their existing health benefit coverage. For this reason, we will grandfather most group and
individual plans. In a continued effort to simplify our plan offerings, we are reviewing our current
options by state to determine which ones we will offer as grandfathered plans. More information
explaining how we will implement grandfathering for our individual and group customers will be
provided in the near future.
Additionally, in limited situations, the legislation allows clients that made benefit changes after March
23, 2010, that would not meet the grandfathering rules to regain grandfathered status at the next
renewal in 2011. We are working to determine how to help plans possibly regain grandfathered
status.
What is grandfathering?
Grandfathering allows groups and individual members that keep their existing plan from March 23,
2010, to January 1, 2014, to be exempt from the new product and rating framework that is effective in
2014. To maintain grandfathered status, a client must continue to keep the plan and the plan’s
benefits essentially the same. Grandfathering also exempts plans from some of the requirements of
the plan-related provisions effective September 23, 2010.
The following changes can be made without impacting grandfathered status:
Changes in premiums of a policy or plan
Changes required to comply with federal or state law
Changes to increase benefits, or voluntarily comply with provisions of the Patient Protection and
Affordable Care Act
Changes to plan structure, for example, switching from a health reimbursement arrangement to
major medical coverage, or from insured to self-funded coverage
Changes to a provider network
Changes to a prescription drug formulary
The Anthem National Accounts business unit serves members of: Anthem Blue Cross Life and Health Insurance Company and Blue Cross of California using the trade name Anthem Blue
Cross in California; using the trade name Anthem Blue Cross and Blue Shield for the following companies in: Colorado and Nevada: Rocky Mountain Hospital and Medical Service, Inc.;
Connecticut: Anthem Health Plans, Inc.; Georgia: Blue Cross and Blue Shield of Georgia, Inc. and Blue Cross Blue Shield Healthcare Plan of Georgia, Inc.; Indiana: Anthem Insurance
Companies, Inc.; Kentucky: Anthem Health Plans of Kentucky, Inc.; Maine: Anthem Health Plans of Maine, Inc.; Missouri (excluding 30 counties in the Kansas City area): RightCHOICE®
Managed Care, Inc. (RIT), Healthy Alliance® Life Insurance Company (HALIC), and HMO Missouri, Inc. RIT and certain affiliates administer non-HMO benefits underwritten by HALIC and
HMO benefits underwritten by HMO Missouri, Inc. RIT and certain affiliates only provide administrative services for self-funded plans and do not underwrite benefits; New Hampshire:
Anthem Health Plans of New Hampshire, Inc.; Ohio: Community Insurance Company; Virginia (excluding the City of Fairfax, the Town of Vienna and the area east of State Route 123):
Anthem Health Plans of Virginia, Inc.; Wisconsin: Blue Cross Blue Shield of Wisconsin (“BCBSWi”), which underwrites or administers the PPO and indemnity policies; Compcare Health
Services Insurance Corporation (“Compcare”), which underwrites or administers the HMO policies; and Compcare and BCBSWi collectively, which underwrite or administer the POS
policies. In 28 eastern and southeastern counties in New York, Empire Blue Cross Blue Shield, the trade name of Empire HealthChoice Assurance, Inc., underwrites and/or administers
the PPO, EPO, POS and indemnity policies. Independent licensees of the Blue Cross and Blue Shield Association. ® ANTHEM is a registered trademark of Anthem Insurance
Companies, Inc. The Blue Cross and Blue Shield names and symbols are registered marks of the Blue Cross and Blue Shield Association.

Changes to accommodate mergers and acquisitions (as long as the merger or acquisition is not
done solely to allow a group to move from one grandfathered plan to another when the plan
change would reduce benefits or increase cost sharing in excess of that allowed by the
regulations)
Changes to an ASO plan's third-party administrator
The following changes would cause a loss of grandfathered status:
Eliminate all (or substantially all) benefits to diagnose or treat a particular condition.
Increase coinsurance (or another percentage cost-sharing requirement) above the level at which it
was set on March 23, 2010. In other words, any increase in an insurer or plan's coinsurance will
result in a loss of grandfathered status.
Increase fixed-amount cost-sharing requirements other than copayments, such as a deductible or
an out-of-pocket limit, by a total percentage (measured from March 23, 2010) that is more than
the sum of medical inflation plus 15%.
Increase copayments above the level in effect on March 23, 2010, by an amount that exceeds the
greater of (a) the sum of medical inflation plus 15%, or (B) $5 increased by medical inflation.
Reduce employer contributions (calculated by cost or formula, such as hours worked) toward any
tier of group health insurance coverage or a group health plan by more than 5% below the
contribution rate on March 23, 2010.
Impose an annual limit on the dollar value of benefits if an annual or lifetime limit had not been
previously imposed on all benefits or, for plans that previously imposed a lifetime limit of all
benefits, impose an overall annual dollar limit that is lower than the lifetime limit, or, for plans that
previously imposed an annual limit on all benefits, decreases the dollar value of the annual limit.
Issuer or plan sponsor does not disclose to participants and beneficiaries that the plan or
coverage is a grandfathered health plan.
Change from one insurer to another
The Anthem National Accounts business unit serves members of: Anthem Blue Cross Life and Health Insurance Company and Blue Cross of California using the trade name Anthem Blue
Cross in California; using the trade name Anthem Blue Cross and Blue Shield for the following companies in: Colorado and Nevada: Rocky Mountain Hospital and Medical Service, Inc.;
Connecticut: Anthem Health Plans, Inc.; Georgia: Blue Cross and Blue Shield of Georgia, Inc. and Blue Cross Blue Shield Healthcare Plan of Georgia, Inc.; Indiana: Anthem Insurance
Companies, Inc.; Kentucky: Anthem Health Plans of Kentucky, Inc.; Maine: Anthem Health Plans of Maine, Inc.; Missouri (excluding 30 counties in the Kansas City area): RightCHOICE®
Managed Care, Inc. (RIT), Healthy Alliance® Life Insurance Company (HALIC), and HMO Missouri, Inc. RIT and certain affiliates administer non-HMO benefits underwritten by HALIC and
HMO benefits underwritten by HMO Missouri, Inc. RIT and certain affiliates only provide administrative services for self-funded plans and do not underwrite benefits; New Hampshire:
Anthem Health Plans of New Hampshire, Inc.; Ohio: Community Insurance Company; Virginia (excluding the City of Fairfax, the Town of Vienna and the area east of State Route 123):
Anthem Health Plans of Virginia, Inc.; Wisconsin: Blue Cross Blue Shield of Wisconsin (“BCBSWi”), which underwrites or administers the PPO and indemnity policies; Compcare Health
Services Insurance Corporation (“Compcare”), which underwrites or administers the HMO policies; and Compcare and BCBSWi collectively, which underwrite or administer the POS
policies. In 28 eastern and southeastern counties in New York, Empire Blue Cross Blue Shield, the trade name of Empire HealthChoice Assurance, Inc., underwrites and/or administers
the PPO, EPO, POS and indemnity policies. Independent licensees of the Blue Cross and Blue Shield Association. ® ANTHEM is a registered trademark of Anthem Insurance
Companies, Inc. The Blue Cross and Blue Shield names and symbols are registered marks of the Blue Cross and Blue Shield Association.